Alzheimer's disease (AD) is a progressive neurodegenerative disease characterized by impairments in memory and cognition, neuronal loss and deposition of beta-amyloid (Abeta) peptides that are derived from larger amyloid precursor proteins (APP). Inheritance of mutated PSEN1 and PSEN2 genes, encoding presenilin 1 and presenilin 2 (PS1 and PS2) variants, respectively, cause early-onset, autosomal dominant forms of familial AD (FAD), an aggressive form of disease that affects patients in the second to fifth decades of life (Price and Sisodia, 1998). We have demonstrated that expression of human FAD-linked PS1 variants in all CNS cell types in transgenic mice impairs environmental enrichment (EE)-induced division (termed proliferation) and production of new neurons (termed neurogenesis) of precursor cells (termed NPCs) in the hippocampus (Choi et al., 2008), and the experiments proposed in this application are designed to clarify the molecular and cellular mechanism(s) by which these mutant PS1 variants alters the homeostasis of hippocampal NPCs. Because the hippocampal NPCs provide a cellular reservoir for replacement of granule cells during normal aging, we suggest that in AD, mechanisms responsible for NPC division and neuronal differentiation are impaired and hence cannot fully compensate for the severe neuronal loss in disease. Indeed, recent studies have revealed a marked reduction in the numbers of NPC and their derivatives in brains of aged humans and patients with AD. As the hippocampus plays a central role in memory formation, understanding the physiological and molecular underpinnings of mutant PS1 on NPC proliferation and neurogenesis is critical. To this end, we have shown that proliferation and neurogenesis of hippocampal NPCs are controlled, at least in part, by microglial cells in the hippocampal niche by non-cell autonomous mechanisms. We now propose three Aims in which we will employ biochemical and genetic strategies to elucidate the cellular and molecular mechanisms underlying the effects of FAD-linked PS1 on proliferation and neuronal differentiation of adult hippocampal progenitors.